Wheel Pros v. Wheels Outlet - Complaint

Case 3:14-cv-04230-M Document 1 Filed 12/01/14
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I N T H E U N I T E D S TAT E S D I S T R I C T C O U R T
FOR THE NORTHERN DISTRICT OF TEXAS
DA L L A S D I V I S I O N
WHEEL PROS, LLC,
Plaintiff,
v.
W H E E L S O U T L E T, I N C . , A B D U L
NAIM, AND DOES 1-25,
Defendants.
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Case No. ____________
Electronically Filed
JURY DEMANDED
P L A I N T I F F S O R I G I N A L C O M P L A I N T - J U RY D E M A N D E D
1. Plaintiff Wheel Pros, LLC brings this suit against Defendants Wheels
Outlet, Inc., Abdul Naim, and Does 1-25 for unauthorized and willful
infringement and counterfeiting of Wheel Pros trademarks in connection
with Defendants wheel products, product packaging, and promotional
materials. Wheel Pros seeks preliminary and permanent injunctions;
statutory damages; treble damages or profits; compensatory damages;
punitive damages; pre-judgment interest; attorneys fees; and investigator
fees and costs as a result of Defendants sale, offers for sale, distribution,
promotion, and advertising of wheel products infringing on Wheel Pros
federally registered trademarks and patents.
Plaintiffs Original Complaint - Jury Demanded
Page 1
THE PARTIES
2. Plaintiff Wheel Pros, LLC is a limited liability company organized and
existing under the laws of the State of Delaware with its principal place of
business at 5347 S. Valentia Way, Suite 200, Greenwood Village, Colorado
80111.
3. Wheel Pros is informed and believes, and on that basis alleges, that
defendant Wheels Outlet, Inc. is a corporation organized and existing under
the laws of the State of Texas with a distribution center located at 2449
Houston Street, Grand Prairie, Texas 75050.
4. Wheel Pros is informed and believes, and on that basis alleges, that
defendant Abdul Naim is a resident of Texas.
5. Doe Defendants 1 25 are entities and individuals who acted jointly
and in concert to commit the acts complained of herein. The Doe Defendants
true names and capacities are presently unknown to Wheel Pros but are
likely to be obtained through discovery. Together with Defendants Wheels
Outlet and Naim, each of the fictitiously named Doe Defendants is
responsible in some manner for the acts and occurrences alleged in this
complaint. Defendants Wheels Outlet, Naim, and each of the fictitiously
named defendants proximately caused the damages alleged.
JURISDICTION AND VENUE
6. This Court has original jurisdiction over the infringement claims
under 15 U.S.C. 1121 and 28 U.S.C. 1331 and 1338, and supplemental
jurisdiction over the state law claims under 28 U.S.C. 1367 (a) because the
state law claims are so related to the federal claims that they form part of the
same case or controversy and derive from a common nucleus of operative
fact.
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7. The Court also has diversity jurisdiction over all claims under 28
U.S.C. 1332, as there is complete diversity of citizenship between Wheel
Pros and Defendants, and the amount in controversy exceeds $75,000
exclusive of interest and costs.
8. Venue is proper in the United States District Court for the Northern
District of Texas, Dallas division under 28 U.S.C. 1391(b) because a
substantial part of the events giving rise to the claims herein occurred in this
judicial district.
GENERAL ALLEGATIONS
A.
Wheel Pros business, patents, and trademarks.

9. Wheel Pros distributes more than two dozen brands of high-
performance wheels and tires for cars, trucks, and SUVs to customers in
roughly 30 countries worldwide. Two of its biggest designs are wheels
marketed under the XD Series Rockstar patent and trademarks and the KMC
trademarks.
10. Wheel Pros has provided consumers with goods under its XD Series
Rockstar design marks and patents and the KMC trademarks since at least
2005.
11. Wheel Pros owns a federal design patent registration for the XD
Series Rockstar XD775, Patent No. D509,783, issued September, 20, 2005. A
true and correct copy of the design patent is attached as Exhibit A.
12. Wheel Pros owns a federal design patent registration for the XD Series
Rockstar XD811, Patent No. D709,018, issued July 15, 2014. A true and correct
copy of the design patent is attached as Exhibit B.
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13. Wheel Pros patents are associated with Wheel Pros in the minds of
consumers, the public, and the automotive industry. They identify high
quality products associated with and originating from Wheel Pros.
14. Wheel Pros owns a federal trademark registration for the XD Series
Star design mark, Reg. No. 4,513,500, for automotive vehicle wheels and
components thereof in Class 12. The XD Series Star design mark appears as
follows:
A true and correct copy of the XD Series Star design mark registration is
attached as Exhibit C.
15. Wheel Pros owns a federal trademark registration for the KMC design
mark, Reg. No 3,027,059, for automotive vehicle wheels and components
thereof in Class 12. The KMC design mark appears as follows:
A true and correct copy of the KMC design mark registration is attached as
Exhibit D.
16. Wheel Pros trademarks are associated with Wheel Pros in the minds
of consumers, the public, and the automotive industry. They identify high
quality products associated with and originating from Wheel Pros.
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17. Wheel Pros has gone to great lengths to protect its name and enforce
the Wheel Pros patents and trademarks. These trademarks and patents are
in full force and effect and have become incontestable under 15 U.S.C. 1065.
B.
Defendants wrongful conduct.

18. Upon information and belief, long after Wheel Pros federal patent
and trademark registrations, Defendants began selling, offering for sale,

distributing, promoting, and advertising in interstate commerce counterfeit
wheels infringing on Wheel Pros XD Series Rockstar patents and trademarks
and KMC trademark.
19. The spurious marks or designations used by Defendants in interstate
commerce are identical with or substantially indistinguishable from Wheel
Pros patents and trademarks.
20. On information and belief, Defendants are producing, distributing,
and selling custom wheels appearing as follows:
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21. Defendants wheel is identical to Wheel Pros patented XD Series

Rockstar Design, and the logos on the spoke are almost identical to the XD
Series design mark and the KMC design marks as used by Wheel Pros since
at least 2005.
22. On or about July 7, 2014, Wheel Pros received a wheel it had trap
purchased from Wheels Outlet. A true and correct copy of the receipt for this
purchase is attached as Exhibit E. Digital images of this counterfeit wheel (in
the style of Rockstar XD775) are attached as Exhibit F.
23. On July 8, 2014, counsel for Wheel Pros sent Defendant Abdul Naim a
cease and desist letter informing him of the illegality and potential penalties
for the sale of infringing and counterfeit Wheel Pros merchandise by
registered mail, return receipt requested. Counsel for Wheel Pros did not
receive a response to its correspondence, even though it was accepted and
signed for. A true and correct copy of this correspondence is attached as
Exhibit G.
24. On or about November 20, 2014, a Wheel Pros customer informed
Wheel Pros that Defendants are now selling additional counterfeit wheels (in
the style of Rockstar XD811). Digital images of this counterfeit wheel are
attached as Exhibit H.
25. Defendants are not now, nor have they ever been, associated,
affiliated, or connected with, or endorsed or sanctioned by Wheel Pros.
Wheel Pros has never authorized or consented in any way to the use by
Defendants of the Wheel Pros registered patents, trademarks, or copies
thereof.
26. Defendants use of the Wheel Pros patents, trademarks, or copies
thereof on Defendants products is likely to cause consumers, the public, and
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the automotive industry to erroneously believe that the goods sold by

Defendants emanate or originate from Wheel Pros, or that said items are
authorized, sponsored, or approved by Wheel Pros, even though they are
not. This confusion causes irreparable harm to Wheel Pros and weakens the
distinctive quality of the Wheel Pros patents and trademarks.
27. Defendants are trading on the goodwill and reputation of Wheel Pros
and creating the false impression that Defendants goods are Wheel Pros
legitimate products. Defendants have been unjustly enriched by illegally
using
and
misappropriating
Wheel
Pros
intellectual
property
for
Defendants own financial gain. Furthermore, Defendants have unfairly

benefited and profited from Wheel Pros outstanding reputation for high
quality products and its significant advertising and promotion of its wheels.
28. Defendants have also disparaged Wheel Pros, its patents, trademarks,
and wheels by creating a false association with Wheel Pros, its genuine
goods, and its patents and trademarks. Wheel Pros has no control over the
nature and quality of the counterfeit products sold by Defendants bearing
infringements of Wheel Pros patents and trademarks. Further, Defendants
counterfeit wheels are not manufactured with safe processes and could be
potentially dangerous to the public. The mounting pad of Defendants
counterfeit wheels is painted, which any reputable manufacturer would not
allow. The paint on the mounting pad formed clumps that created an
irregular raised surface on the mounting pad. See Exhibit I. This would lead
to a false torque reading of the wheel when installed. Further, as the paint
clumps break up under normal use, the wheel would likely come loose and
potentially cause grave harm to the consumer. A consumer is likely to think
these safety issues are Wheel Pros fault.
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29. Defendants acts are calculated to confuse and deceive the public and
are performed with full knowledge of Wheel Pros rights.
30. Upon information and belief, Defendants have acted with reckless
disregard for Wheel Pros rights or were willfully blind in connection with
their unlawful activities.
31. Upon information and belief, Defendants have willfully and
maliciously engaged in their counterfeiting and infringing activities.
32. Defendants wrongful acts will continue unless enjoined by the court.
Accordingly, Defendants must be restrained and enjoined from any further
counterfeiting or infringement of Wheel Pros patents and trademarks.
FIRST CLAIM FOR RELIEF
Federal Trademark Infringement and Counterfeiting Under 15 U.S.C. 1114(1)(a)
Wheel Pros incorporates by reference the allegations set forth in
Paragraphs 1 through 32.
33. Defendants unauthorized use of the XD Series Rockstar design as
part of their series of custom wheels and their related services, promotional
materials, and advertising materials constitutes trademark infringement of
the Wheel Pros XD Series design mark and the KMC design mark in
violation of 15 U.S.C. 1114(1)(a). Defendants use of Wheel Pros design
mark is likely to cause, and on information and belief has actually caused,
confusion, mistake, or deception in the market as to the source or origin of
Defendants products, and has falsely suggested that Defendants goods are
sponsored or endorsed by, connected to, or affiliated with Wheel Pros.
34. As a direct and proximate result of Defendants conduct, Wheel Pros
has suffered, and will continue to suffer, irreparable injury to its business,
reputation, and goodwill, unless and until Defendants actions are enjoined.
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Wheel Pros has no adequate remedy at law and has suffered irreparable
injury and is, therefore, entitled to injunctive relief.
35. As a direct and proximate result of Defendants actions, Wheel Pros
has also suffered, and will continue to suffer, monetary damages in an
amount to be proven at trial.
36. Defendants unauthorized use of these marks was and is knowing,
deliberate, and willful. Wheel Pros is, therefore, entitled to recover three
times the amount of its damages as well as its attorney fees and costs
incurred in this action.
SECOND CLAIM FOR RELIEF
Federal Trademark Counterfeiting 15 U.S.C. 1114(1)
37. Defendants acts constitute trademark counterfeiting in violation of
Section 32 of the Lanham Act, 15 U.S.C. 1114(1).
38. Defendants have used spurious designations that are identical with,
or substantially indistinguishable from, the Wheel Pros trademarks on goods
covered by the registration for the trademarks. Defendants have used these
spurious designations knowing they are counterfeit in connection with the
advertisement, promotion, sale, offering for sale, and distribution of goods.
39. Defendants use of the Wheel Pros marks to advertise, promote,
distribute, and sell Defendants wheels was and is without the consent of
Wheel Pros and were willful and malicious.
40. Defendants unauthorized use of the Wheel Pros trademarks is likely
to: (a) cause confusion, mistake, and deception, (b) cause the public to believe
that Defendants wheels are the same as Wheel Pros wheels or that
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Defendants are authorized, sponsored, or approved by Wheel Pros or that

Defendants are affiliated, connected, or associated with or in some way
related to Wheel Pros; and (c) result in Defendants unfairly benefiting from
Wheel Pros advertising and promotion and profiting from the reputation of
Wheel Pros and its XD Series and KMC trademarks all to the substantial and
irreparable injury of Wheel Pros and the substantial goodwill it has built.
41. Under 15 U.S.C. 1117, Defendants are liable to Wheel Pros for:
(a) statutory damages in the amount of up to $1,000,000 for each mark
counterfeited, or at Wheel Pros election an amount representing three times
Wheel Pros damages or Defendants illicit profits; and (b) reasonable
attorneys fees, investigative fees, and pre-judgment interest.
THIRD CLAIM FOR RELIEF
Federal Trademark Dilution 15 U.S.C. 1125(c)
42. Wheel Pros is the largest aftermarket wheel company in the world
and its brands, including the XD Series and KMC Series trademarks, are
famous and distinctive. Wheel Pros has used the XD Series and KMC
trademarks in commerce since at least 2005.
43. Defendants used these marks as late as 2014 after Wheel Pros marks
have become famous.
44. Defendants use of the marks is likely to cause dilution of Wheel Pros
distinctive quality.
45. Defendants have profited through the infringement of Wheel Pros
patents and, as a result of Defendants unlawful infringement of Wheel Pros
XD Series and KMC trademarks, Wheel Pros has suffered and will continue
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to suffer damages. Wheel Pros is entitled to recover from Defendants the

damages suffered by Wheel Pros as the result of its unlawful acts.
46. On information and belief, Defendants intend to continue their
unlawful infringing activity and Wheel Pros will continue to suffer
irreparable harm for which there is no adequate remedy at law unless the
Court enjoins Defendants from further infringing and diluting activities
FOURTH CLAIM FOR RELIEF
Patent Infringement 35 U.S.C. 271, 289
47. Wheel Pros is the owner of all right, title, and interest in the XD Series
Rockstar wheel design U.S. Patent Nos. D509,783 and D709,018.
48. Upon information and belief, in violation of 35 U.S.C. 271,
Defendants are and have been directly infringing, contributing to the
infringement of, or inducing others to infringe on the XD Series Rockstar
patent by making, using, selling, or offering to sell in the United States, or
importing into the United States, products or processes protected by the
Wheel Pros patents.
49. Defendants have profited through the infringement of the Wheel Pros
patent and as a result of Defendants unlawful infringement of the XD Series
Rockstar patents, Wheel Pros has suffered and will continue to suffer
damages. Wheel Pros is entitled to recover from Defendants the damages
suffered by Wheel Pros as the result of its unlawful acts.
50. On information and belief, Defendants intend to continue their
unlawful infringing activity, and Wheel Pros will continue to suffer
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irreparable harm for which there is no adequate remedy at law unless the
Court enjoins Defendants from further infringing activities.
FIFTH CLAIM FOR RELIEF
Federal Unfair Competition Lanham Act / False Representation 15 U.S.C. 1125(a)
51. Defendants use in commerce of a copy or colorable imitation of
Wheel Pros XD Series Rockstar patents and XD Series and KMC trademarks
constitutes a misappropriation of a distinguishing characteristic of Wheel
Pros itself and a false representation to the public of the character and quality
of Defendants goods and services, and is likely to cause confusion, mistake,
or deception as to the affiliation, connection, or association of the Defendants
with Wheel Pros as to the origin, sponsorship, or approval of Defendants
goods by Wheel Pros, as well as confusion, mistake, or deception concerning
the source of Wheel Pros patents and trademarks, all in violation of 15
U.S.C. 1125(a) and to the great damage of Wheel Pros and the public.
52. As a direct and proximate result of Defendants false representations
and misappropriation of Wheel Pros patents and design marks, through the
use of a copy, counterfeit, or colorable imitation thereof in interstate
commerce, Defendants have and continue to injure Wheel Pros, and Wheel
Pros has sustained and will continue to sustain substantial damage to its
business, goodwill, reputation, and profits. The precise nature and amount of
these accrued and continuing damages are not presently known to Wheel
Pros. As a result of Defendants wrongful conduct, Wheel Pros has also been
forced to incur attorneys fees and costs.
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53. Wheel Pros has no adequate remedy at law against Defendants acts
of false representation and unfair competition. Unless Defendants are
enjoined from their above-identified conduct, Wheel Pros will continue to
suffer irreparable harm. Wheel Pros is entitled to preliminary and permanent
injunctive relief under 15 U.S.C. 1116.
54. Wheel Pros is also entitled to an award of Defendants profits
unlawfully obtained by way of its infringing uses under 15 U.S.C. 1117.
Such profits constitute the gross sales by Defendants of all products using
the XD Series Rockstar patents and XD Series and KMC marks.
55. Wheel Pros also seeks to have all of Defendants products and
advertisements, and other infringing uses of Wheel Pros mark in the
possession, custody, or control of Defendants or their agents, employees, or
attorneys, or those persons or entities otherwise acting in concert with
Defendants, destroyed under 15 U.S.C. 1118.
56. Wheel Pros is also informed and believes that Defendants contend
their conduct does not constitute false representation or unfair competition.
Accordingly, Wheel Pros requests a declaratory judgment from this Court
declaring the rights of Wheel Pros as the sole owner and exclusive user of the
XD Series Rockstar patents and XD Series and KMC design marks, as well as
Defendants lack of any rights to use or continue to use these marks in
interstate commerce.
57. To the extent Defendants violations of 15 U.S.C. 1125(a) were and
continue to be intentional, Wheel Pros is also entitled to an award of treble
damages, prejudgment interest, and reasonable attorneys fees against
Defendants under 15 U.S.C. 1117.
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SIXTH CLAIM FOR RELIEF

State law trademark infringement and dilution under
TEX. BUS. & COMM. CODE 16.102-16.104
58. Defendants unauthorized use of the XD Series Rockstar design as
part of their series of custom wheels and their related services, promotional
materials, and advertising materials constitutes trademark infringement of
the Wheel Pros XD Series design mark and the KMC design mark in
violation of TEX. BUS. & COMM. CODE 16.102-16.104. Defendants use of
Wheel Pros design mark is likely to cause, and on information and belief has
actually caused, confusion, mistake, or deception in the market as to the
source or origin of Defendants products, and has falsely suggested that
Defendants goods are sponsored or endorsed by, connected to, or affiliated
with Wheel Pros.
59. As a direct and proximate result of Defendants conduct, Wheel Pros
has suffered, and will continue to suffer, irreparable injury to its business,
reputation, and goodwill, unless and until Defendants actions are enjoined.
Wheel Pros has no adequate remedy at law and has suffered irreparable
injury and is, therefore, entitled to injunctive relief.
60. As a direct and proximate result of Defendants actions, Wheel Pros
has also suffered, and will continue to suffer, monetary damages in an
amount to be proven at trial.
61. Defendants unauthorized use of these marks was and is knowing,
deliberate, and willful. Wheel Pros is, therefore, entitled to recover three
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times the amount of its damages as well as its attorney fees and costs
incurred in this action.
SEVENTH CLAIM FOR RELIEF
State law unfair competition by misappropriation
62. Defendants conduct constitutes an unfair, fraudulent, or unlawful
business act or practice in violation of Texas common law, specifically unfair
competition by misappropriation.
63. Wheel Pros has no adequate remedy at law against Defendants unfair
business acts or practices. Unless Defendants are enjoined from this conduct,
Wheel Pros will continue to suffer irreparable harm and Defendants will be
unjustly enriched. Accordingly, Wheel Pros seeks preliminary and
permanent injunctive relief precluding Defendants from any further use in
commerce of the XD Series design mark and the KMC design mark or any
copy, counterfeit, or colorable imitation of Wheel Pros XD Rockstar Series
wheels.
64. Under Texas law, Wheel Pros seeks to have all of the profits which are
the product of Defendants unfair business acts or practices disgorged and
paid over to Wheel Pros.
PRAYER FOR RELIEF
Plaintiff Wheel Pros, LLC hereby demands a jury trial on all issues so
triable. Wheel Pros prays for judgment against Defendants as follows:
(a) For preliminary and permanent injunctive relief, enjoining Defendants
and each of their partners, officers, directors, associates, agents, servants, and
employees, and all others acting or attempting to act in concert with
Defendants, from directly or indirectly infringing on Wheel Pros patents and
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trademarks, specifically, the XD Series Rockstar patents, XD Series design

mark, and the KMC design mark and from continuing to sell, market, offer,
dispose of, license, transfer, display, advertise, reproduce, develop, or
manufacture any services, events, products, or goods using Wheel Pros
trademarks or trade dress or any confusingly similar version of such
trademarks or trade dress, or to assist or participate in any such activity;
(b) For a preliminary and permanent injunction enjoining Defendants and
each of their partners, officers, directors, associates, agents, servants, and
employees, and all others acting or attempting to act in concert with
Defendants, from taking any action which may confuse Wheel Pros
customers or the public about the sponsorship or source of Defendants
events, services, or goods, or about Wheel Pros being the source or sponsor
of events, services, or goods that are not licensed or authorized by Wheel
Pros;
(c) For an order requiring Defendants: (i) to pay all of Wheel Pros
compensatory damages, including but not limited to, damages based upon
the Defendants acts of trademark infringement under the Lanham Act, 15
U.S.C. 1051, et seq., and all other causes of action herein; (ii) to account to
Wheel Pros and disgorge all profits that Defendants have derived from the
infringing use of Wheel Pros trademarks; and (iii) to pay Wheel Pros all
damages that Wheel Pros has sustained by reason of Defendants conduct
alleged herein, including treble damages for willful infringement;
(d) For an order requiring Defendants to provide restitution for their
actual and exemplary damages under Texas law;
(e) For prejudgment interest as authorized by law;
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(f) For Wheel Pros reasonable attorneys fees and costs of suit incurred
in bringing this action to prevent and redress Defendants knowing,
deliberate, willful, and fraudulent infringement; and
(g) For such other and further relief as the Court deems just and proper.
Respectfully submitted,
By:
/s/Susan Egeland______
Susan E. Egeland
(TX State Bar No. 24040854)
segeland@hptylaw.com
Matthew C. Sapp
(TX State Bar. No. 24063563)
msapp@hptylaw.com
HAWKINS PARNELL
THACKSTON & YOUNG, LLP
4514 Cole Avenue, Suite 500
Dallas, Texas 75205
Telephone (214) 780-5100
Fax (214) 780-5200
ATTORNEYS FOR PLAINTIFF
WHEEL PROS, LLC.
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Case 3:14-cv-04230-M Document 1 Filed 12/01/14

Case No. ____________

Plaintiffs Original Complaint - Jury Demanded

Case 3:14-cv-04230-M Document 1 Filed 12/01/14

Case 3:14-cv-04230-M Document 1 Filed 12/01/14

Wheel Pros business, patents, and trademarks.

Plaintiffs Original Complaint - Jury Demanded

Case 3:14-cv-04230-M Document 1 Filed 12/01/14

Plaintiffs Original Complaint - Jury Demanded

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Defendants wrongful conduct.

and trademark registrations, Defendants began selling, offering for sale,

Plaintiffs Original Complaint - Jury Demanded

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21. Defendants wheel is identical to Wheel Pros patented XD Series

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the automotive industry to erroneously believe that the goods sold by

Defendants own financial gain. Furthermore, Defendants have unfairly

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Defendants are authorized, sponsored, or approved by Wheel Pros or that

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to suffer damages. Wheel Pros is entitled to recover from Defendants the

Plaintiffs Original Complaint - Jury Demanded

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Plaintiffs Original Complaint - Jury Demanded

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Plaintiffs Original Complaint - Jury Demanded

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SIXTH CLAIM FOR RELIEF

Plaintiffs Original Complaint - Jury Demanded

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trademarks, specifically, the XD Series Rockstar patents, XD Series design

Plaintiffs Original Complaint - Jury Demanded

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